EUROPEAN SHARES
Equity markets opened steady on Monday, holding previous gains ahead of another slew of major macro data from the US and EU this week. The overall market starts its new week catching its breath with an expected pause following the latest sharp rally on stocks, as today’s gains in the healthcare and consumer non-cyclical sectors were offset by losses in industrial and utility shares.
Despite benchmarks currently trading sideways, the general sentiment remains optimistic, and investors’ risk appetite has stayed high. In Europe, the prospect of the next monetary easing cycle from the ECB next month is lifting market sentiment more and more every day, while things are also starting to look better on the other side of the Atlantic. Indeed, US stock investors, already reassured by a strong earning season so far, were also relieved by the latest batch of US macro data, especially on the employment front.
That being said, markets are likely heading for a volatile week as many investors already look forward to crucial CPI data from both the US and the EU, with hopes that these reports will cast some light on the next easing cycles from the FED and the ECB, especially in terms of schedule and pace of such monetary moves. Meanwhile, the technical situation stays positive as the STOXX-50 index trades well above the 5,050pts level, its last major resistance in the short term.
The next target sits around 5,115pts, the last level before the market goes back into uncharted territory with a new all-time high, which could happen later this week if CPI data were to confirm dovish hopes from investors.
Pierre Veyret – Technical analyst, ActivTrades
Source: ActivTrader
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